139.85 -2.6 (-1.86%) Buy

Don't buy PRAJIND now, it is underperforming the market

13 min read

PRAJ INDUSTRIES LTD was among the worst performers on Friday. It fell by -1.86% to close at 139.85. It is currently trading +94% above it's 52 week low of 71.73 and is down only -9% from it's 52 week high.

[Themes containing PRAJIND]

PRAJIND showed a strong bullish trend over the last 3 months. During this period PRAJIND increased by +34.54% and saw a maximum drawdown of -13.75%. There were 2 long signals during this period that returned a cumulative of +19.77% to investors.


PRAJIND has been outperforming the NIFTY-50 index in recent time. It showed significant outperformance (compared to the NIFTY-50 index) from 23 Aug, 2018 to 14 Jan, 2019. Over the last 3 years and 1 month, PRAJIND outperformed the NIFTY-50 index on 44% days. Which indicates that on days PRAJIND outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.

During the last three months PRAJIND was mostly profitable and delivered on average +0.53% per day. It's best return during this period (of +12.28%) was on Wednesday, 9 Jan, 2019. While it's worst loss in the same period (of -7.44%) was on Thursday, 17 Jan, 2019. The longest stort-term trend during this period was 5 profitable days, which started on 28 Dec, 2018 and went on till 3 Jan, 2019. This bullish trend returned +15.27% to investors.

During the last year PRAJIND had 8 profitable months and 4 loss making months. PRAJIND returned profits in more months than NIFTY-50 index. PRAJIND significantly outperformed NIFTY-50 index in Jan 2019, when it returned +27.48% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. PRAJIND had a longer winning streak of profitable months than NIFTY-50 index. It went up in 4 straight months (from Jul 2018 to Oct 2018) during which period it delivered +38.58%. It is interesting to note that both PRAJIND and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

"If all the economists were laid end to end, they'd never reach a conclusion.

PRAJIND is currently seeing overall increase in volatility. In comparison, the NIFTY-50 index is seeing decrease in volatility. During the last three months, there was a significant surge in PRAJIND's volatility from 5 Dec, 2018 to 9 Jan, 2019. While there was a significant fall in the NIFTY-50 index's volatility from 31 Oct, 2018 to 5 Dec, 2018.

Advanced/professional short-term investors should note that PRAJIND has significant negative skewness in it's return distribution. This indicates that PRAJIND is very risky for short-term investment and can significantly underperform for long durations.

NIFTY-50 index has more chance of extreme outcomes than PRAJIND. Therefore, NIFTY-50 must receive a lower allocation than PRAJIND in your portfolio. NIFTY-50 index usually has shorter drawdown period than PRAJIND.

Based on your interest in PRAJIND you may find it interesting to know that HATSUN is a mid cap that has shown remarkable performance and deserves to be on every investors' watchlist.

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